When Volkswagen's Africa boss Thomas Schaefer set out to conquer the contin...
JOHANNESBURG/KIGALI - When Volkswagen’s Africa boss Thomas Schaefer set out to conquer the continent, he quickly realized he needed more than a flashy new product. He needed a new business model.
Industry experts are divided on the merits of the plan, with some questioning whether VW can compete with the likes of Uber and Bolt in Africa or, in light of those companies’ losses, if it should even try. VW’s ride-hailing cars are assembled in Kigali at a new $20 million plant that also produces vehicles for the relatively few customers able to afford a brand new Polo, Passat or Teramont.
VW hopes combining all these businesses - new car sales, ride-hailing, car-sharing, used car sales, parts and service - can make the company’s investment in Rwanda worthwhile. Rwanda has already earned a reputation for innovation - from a cashless public transport system to medical drones. The city’s budding IT sector allowed VW to develop its app locally.“This truly is a fantastic case study for future mobility in progressive frontier economies,” said Martyn Davies, managing director for emerging markets at Deloitte.
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